Energy Performance Certificates and Housing Transaction Prices: Empirical Evidence from Market Data Analysis

Abstract

In recent years, the intersection between real estate market dynamics and environmental sustainability has gained increasing attention, particularly in light of the European Union’s regulatory efforts to decarbonize the building sector. Energy Performance Certificates (EPCs), initially conceived as informational tools, are now emerging as significant drivers of housing prices and investment decisions. This study investigates the impact of EPCs on real estate transaction prices within the urban context of Turin, Italy, with a specific focus on spatial effects often neglected in traditional analyses. Using a dataset of over 5,000 property listings from 2022–2023, a Spatial Error Model (SEM) is implemented to capture spatial autocorrelation and improve model accuracy. The results reveal a statistically and economically significant “green premium” for high-efficiency dwellings (EPC A and B–C) and a corresponding “brown discount” for inefficient properties (EPC F–G). These findings not only validate the role of EPCs in price formation but also align with the broader objectives of the EU Green Deal and the Green Asset Ratio (GAR), which increasingly integrates energy performance into financial valuation. The study offers novel insights into the spatial valuation of sustainability and suggests that market forces, coupled with regulatory instruments, are reshaping investment patterns in the built environment